iStrategy Berlin: Ralf Ahamer from Xing about "How to Create a Revenue Driven Social Networking Presence and Identity like FarmVille"

value of a social network = amount of members x activity

Often businesses look at social networking sites as simply being passive databases of CVs. But some of the world’s most successful companies have recognised the diverse range of values provided by social media platforms. Even in the downturn of 2009, companies with dedicated social media activity significantly boosted their revenue. The forecasted upturn of 2010 points towards a shift in consumer attitudes from recession to recovery, and companies looking to gain competitive edge must take advantage of the business opportunities presented by social media. This presentation will explore the vast scope of business opportunities that social media offers, and how you can make the most of your company’s social media presence.

Let's talk about how you can make money with social networks.

Key take-aways:

• get a critical mass if you want to create a club/community/network
• 80% of experts separate social/private from professional
• we are only at the beginning of social networks
• YOU are the product of social networks, when you join you get an added value through other members
• if you have a brand, you should have the same philosophy as the point above. 3/4 fail because of it
• value of a social network = amount of members x activity
• the websites governing top 10's in 2000 have almost all disappeared
• a community serves it members, afterwards itself
• example: IKEA: creates a high cost community but ignores 90K fans on facebook and 20K employees on Xing... wrong strategy!
• leverage on existing infrastructure and existing reach
• advertising in your own community... difficult case
• traditional agencies and publishers would not recommend social networks as the return for them is very limited, so brands will have to take it upon them. This also causes a problem when you have your own community...you will not be recommanded
• FarmVille:
• •  65 million users if farmville on Facebook
  • 26 million daily users (more than 2 hours per day)
  • 100 million revenue per year for the creator of the game! (since 2007)
• Facebook: 90 million $ revenue out of virtual gifts in 2009